Retirement Trust Board hears market volatility briefing; trustees probe asset-allocation options

The El Paso City Retirement Trust Board received its monthly treasurer—s and investment reports and discussed portfolio positioning amid recent market volatility, with trustees asking staff and consultants to review asset-allocation options.

Treasurer Louis Meyer presented the monthly financial statements, saying the trust—s "total cash and investments [are] approximately 979,000,000" and that net assets available for benefits were "approximately 980,000,000" as of March 31. Meyer summarized seven-month and one-month flows: roughly $36 million in receipts for the seven months, net investment income near $5.1 million and benefits paid to retirees of about $47.9 million for the same period, producing a year-to-date net decrease on the statements presented.

Callan and Kellum LLC representatives told trustees that markets remained volatile after the March report. A Kellum presenter said the trust recorded an unrealized investment loss for the month of about $26,000,000, reducing the firm—s estimate of total fund value to roughly $968,000,000 through the first calendar quarter. The consultant noted that some active managers were producing positive excess returns even in the down market and that the trust had raised nearly $30,000,000 out of the equity portfolio earlier to fund forthcoming capital calls and a new real-estate manager—s initial contribution (about $15,000,000), leaving a cash runway of about $17 million to $18 million to meet benefit payments and near-term calls.

Trustees questioned the role of fixed income after recent bond-market moves and rising volatility. One trustee asked whether the board should "entertain maybe a shift away from bonds into holding more real assets." A Callan representative cautioned there is no single asset class that checks every box and noted tradeoffs between liquidity, volatility and long-term return. The consultant recommended reviewing allocations and considering the asset-liability study and annual asset-only updates as the proper forums for structural changes.

Board members discussed practical next steps: continuing asset-allocation conversations in the investment committee, considering quarterly rebalancing where appropriate, and scheduling an asset-liability study or update (the last study was done in 2023). The consultant described the VIX as "the fear gauge," a forward-looking measure derived from S&P 500 option prices that spikes in episodes of market panic, and said current readings were similar in character to sharp draws seen in prior crisis periods.

On administrative matters, Deputy Executive Director Adrian Sanchez reported that annual benefit statements for active employees were distributed to departments before March and that the 2025 employee trustee election would be held electronically April 21—April 23 through the city clerk. Sanchez also noted upcoming training and conferences, including the NCBRS annual conference in Denver (May 20—21) and a local summer conference in El Paso in August at the Paso Del Norte (details to be finalized). Board materials included the 2024 annual financial summary booklet and the Compass Points newsletter, Sanchez said.

Procedural actions recorded during the meeting included adoption of the consent agenda and the formal adjournment. The board adopted the consent agenda on a roll-call motion (moved by Trustee Kerr and seconded by Trustee Friscala) with all trustees voting aye. The meeting was later adjourned following a motion by Carl Rivkah, seconded by Trustee Kerr; the chair announced the motion carried and adjourned the meeting at 09:30 a.m.

The board instructed staff and the investment consultant to continue examining allocation mixes, potential real-asset and infrastructure opportunities, and to present an asset-only allocation update or asset-liability study for committee review at an upcoming meeting.